If you are wondering whether getting Payday Loans Online can affect your credit score negatively, the answer will vary depending on the repayment. Learn more about whether it can hurt your credit score or not here.
When you need emergency cash, you can apply for a payday loan whether you decide to go to a storefront or apply for it online. Applying and qualifying for a payday loan is quite easy, and it just takes a few minutes whether you go to a storefront or apply online. Payday loans are not difficult to qualify for as compared to other financial institutions. And yes, it offers many benefits, which is the reason why many decide to choose to apply for payday loans over others. Since there are many misconceptions around payday loans, you may be wondering whether they can negatively impact your credit score or not. If this is the question that’s stopping you from applying for Payday Loans Online, read further to learn more.
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Can Payday Loans Affect Your Credit Score?
Payday loans can affect your credit both positively and negatively depending on whether you pay back on time or not. If you pay back your loan on time, it will have a positive impact on your credit report. However, if you miss the deadline and fail to pay back on time, it will hurt your credit score. Especially if you do not pay back for quite a while, your lender could sell your debt to a debt collection agency, and this will definitely have a negative impact on your credit score. So, as far as the question goes about whether payday loans can affect your credit score negatively or not, it depends on whether you pay back on time or not.
What Can You Do If Your Debt Goes To A Collection Agency?
If you have missed your deadline and your lender sells your debt to a debt collection agency, you should expect calls and emails. And instead of dodging their attempts to collect the debt you owe, get in touch with them and negotiate for a different payment option or a discount. Collection agencies often give a discount if the individual agrees to make a large payment at once, so consider this as an option. The other option is to request a different payment option that will make it easier for you to clear your debts. However, even if you pay off the debt, you should still note that the negative mark will remain in your credit report.
On What Grounds Can You Get Disqualified For A Payday Loan?
If you are below eighteen years and not a citizen or a resident of the US, do not have a valid ID issued by the government, an active bank account, or proof of income, you will not be qualified to get a payday loan. While a bad credit score may not be the determining factor, some lenders check the credit score, so this varies as well, depending on the lender. As easy as it is to get a payday loan, one can also easily get disqualified for it.
If you have decided to apply for Payday Loans Online, make sure to pay it back as soon as possible, this way, you do not have to worry about your debt leaving a negative mark on your credit report. Payday loans can hurt your credit score if you miss the deadline, so paying back on time is crucial. Paying back on time should be crucial.